PRECIOUS-Gold falls as dollar strengthens, Korean tensions ebb

Reuters Staff

3 Min Read

* Dollar index rises back towards Friday's 3-month high
* Investors trim COMEX gold longs in week to April 24
* GRAPHIC-2018 asset returns: tmsnrt.rs/2jvdmXl
(Updates throughout, adds LONDON dateline)
By Jan Harvey
LONDON, April 30 (Reuters) - Gold fell on Monday, pulling
back towards last week's more than one-month low as easing
tensions on the Korean peninsula boosted appetite for assets
seen as higher risk, such as stocks, and lifted the dollar.
The metal slid 1 percent last week on the back of a stronger
dollar and a rise in Treasury yields to above 3 percent, which
weighed on interest in non-interest bearing assets. On Thursday,
it hit its lowest since March 21 at $1,315.06 an ounce.
That has left it on track to end April down 0.5 percent,
erasing all the previous month's gains.
Spot gold was down 0.4 percent at $1,316.15 an ounce
by 0935 GMT, while U.S. gold futures for June delivery
were 0.5 percent lower at $1,316.90 an ounce.
"Easing geopolitical concerns and the strengthening dollar
index are the factors which are creating the sell-off," said
Naeem Aslam, chief markets analyst at Think Markets.
"We are looking at two important support levels - $1,307
followed by $1,300," he said, adding that a "break of these
levels would bring more selling pressure."
At their summit on Friday, North Korean leader Kim Jong Un
and South Korean President Moon Jae-in declared they would take
steps to formally end the 1950-53 Korean War, which ended only
with a truce, and work towards the "denuclearisation" of the
Korean peninsula.
The dollar index rose 0.2 percent on Monday, holding just
below its strongest since mid-January, while European shares
rose after a positive session among Asian stocks overnight as
tensions on the Korean peninsula eased.
Hedge funds and money managers cut their net long position
in COMEX gold contracts and switched to a net long position in
silver contracts in the week to April 24, U.S. Commodity Futures
Trading Commission data showed on Friday.
"After nine consecutive weeks of a rare and even record net
short silver position for money managers, the latest data shows
that for the week ending Tuesday 24 the funds have returned to a
slight net long," ING said in a note.
"Prices had briefly rallied above $17/oz but failed to hold
as gold prices also fell. The gold/silver ratio has since
recovered back above 80x since briefly hitting lows of 78x."
Among other precious metals silver was down 0.6
percent at $16.40 an ounce, off an earlier three-week low of
$16.37. Platinum was down 0.6 percent at $905.00 an
ounce, and palladium was 0.4 percent lower at $969.72.
(Additional reporting by Eileen Soreng in Bengaluru
Editing by Edmund Blair)